Finances

Hey, folks. Today's update will be a rundown of the ways I've spent large chunks of the Kickstarter money. Toward the end of this fairly long post I also comment on the fact that I wish I hadn't spent money on the ancillary parts of the project (locks, cases, etc.) until the picks were completely made and in hand. That's been one of my biggest takeaways from the project.

I'll have another update coming with CAD files and examples of the current plate configurations for chemical etching, etc. but today's is long enough as is.

So, once the pick designs were solidified and I was headed toward prototyping, I felt comfortable spending money on all the other things I was going to need for the business. The first major purchases I made were locks. In total I bought 6000 locks door locks, primarily because the first batch of 3000 had a major flaw that I knew I would have to meticulously correct. Specifically, the #1 and #2 keypins, with their driver pins, managed to stack completely in the plug of the lock. What this means is that when you are picking the lock, if you manage to set some of the pins, but not actually lift a #1 or 2 keypin, the plug will rotate, trapping the spring between the plug and housing of the lock. This typically destroys the lock, as even if you can extricate the spring and remove the plug, the steel spring will have already cut into the softer metal of the housing, causing lasting damage. Unfortunately this batch of locks was sourced from multiple vendors by a third party as a favor to me, so there was no reasonable means of returning them. The problem is solvable, it's just that it would take a lot of time and effort to solve.

Things were moving quickly enough with the picks at that stage (I know...) that I didn't want the locks to hold me up. Especially because I didn't discover the flaw until I was running my first 2 major training, where many people were complaining of locks seizing up on them. I decided that I would purchase new driver pins and repin the first batch of locks over time, and would have them ready for future sales. With that plan in mind, I went ahead and sourced 3000 locks myself, getting samples ahead of time so that I could verify the same problem didn't persist. The new locks came in several weeks later and were perfect. They were also nearly a dollar less per lock than the initial batch. Aside from some issues that came up during the importing process, I loved every bit of the second transaction. Including fees, freight, etc. on both batches of locks, the total came up just under $19000.

There were a number of other, more expensive locks that I had to purchase to fill out the lock library contributions and to fill out my training materials. This cost another $3000 dollars, but some of the locks procured I'll be able to use in many trainings far into the future, which is nice. They aren't all "consumables".

Embarassingly, I've also had to purchase a large number of actual lockpicks, for trainings and workshops. The total amount I have spent on picks to date is $3200. Primarily via the fine folks at Southern Specialities, with a few small orders from SouthOrd when they were havings sales. While most of these are consumables, it also includes pick guns, tubular picks, etc. that I've needed for trainings and that I continue to use in workshops today.

The pick cases should have cost around $3000, though I'm not certain of the exact amount. I believe my Mother documented their production well, so I have access to better figures (I'm actually about to go through and update all my quickbooks info, so I'll have those numbers soon.)

Packing materials, which currently fill my basement storage unit, cost $900 - but that's only about a third to a half of what I will need to complete every order.

There were other miscellaneous expenses that I've lost track of, like cases for traveling with the locks, cases for the lock libraries, sandpaper, spot welder, metal samples etc. that I've lost track of, but probably don't amount to much more than a few hundred dollars. I would assume sub $1k anyway.

Travel and accomodations at various conferences, trainings and research, this includes trips by both car and plane. $2000 of it went directly to the Jetblue Bluepass, which allowed me to attend a number of conferences and small group events I wouldn't have been able to otherwise. There were an additional $2000 ($2009, to be exact, but as you can tell I'm rounding) in airfare for other events, trainings etc. I am not including personal travel in this, only locksport/physical security related talks, workshops and events.

Trips by car cost, in fuel and rental fees (had to rent twice, once because my car broke done, the other for convenience), $1375. This includes a trip to Chicago, 2 tours of business, schools and hackerspaces in Ohio, a trip to DC, 3 trips to NYC, and a rental in LA, though I'm not counting gas for that trip, because though it was bookended by a locksport related events, I used some of the time in between for personal driving.

Hotel stays I kept to a minimum whenever possible, often just sleeping in my car or with friends. Total hotel costs were $330.

I paid a third party $2000 for assistance in the production of the picks and there were some incidental costs in the process of working with him as well. Though that didn't work out very well, the larger cost of course was the time that I lost in the process. I should have bailed much earlier, but instead I stuck it out for many months. Each month I had other, non-locksport expenses.

My rent is $765 per month. I live in Central Square in Cambridge, MA. Our rents are notoriously high, but for my location & the space that I have, it's pretty good. I can and will be living in cheaper accomodations at the conclusion of my current lease.

My health insurance is $350 per month. My auto insurance isn't much, but the car did need a few significant repairs before I finally got rid of it a few months ago. Total repairs on the car came to a little over $3500.

I made 3 personal purchases (outside of meals, laundry detergent and all that normal getting by stuff). I bought a TV for $300, first TV I had purchased in years. I bought a $1200 laptop, as my prior computer had died. It was the most expensive laptop I've ever bought, but as I do a good amount of design work and video editing, and I had just recieved the initial deposit from Amazon, I decided to invest in a decent one. It has served me well and comes with me to every talk, workshop, etc. but for workshops I could have gotten by with a netbook or something, so I'm chalking this up to a personal purchase. I also took a vacation with my family that cost about $700.

There are innumerable small expenses that permeate anyone's life. Groceries, toilet paper, public transportation, etc. I don't keep good track of those things. I've also donated a lot of hardware to different hackerspaces, and all sorts of other stuff.

Anyway, all of this comes to an important point for this project and a piece of advice I can offer to anyone else undertaking something like this. As soon as I felt comfortable about the pick production I went ahead and spent a great deal of money on all of the ancillary parts of the project. At the time I thought of it in terms of timing an elaborate meal. That's not how it actually is. I wish I hadn't spent a dime on the locks, cases, anything, until I had the picks in hand. Primarily because everything else can be compromised on, but not the picks, because they are the crux of the project. Instead, when the production process ground to a halt and I had to start over with a new plan, I had spent a huge part of the investment, and while I had tangible goods from that (especially locks) they were just sitting on the floor of my apartment, which isn't the same as having enough money to change partners, vendors and cutting methods in one go. So, to make up for that I tried to get by with friends, family and hackerspaces, but couldn't quite make it work, and every time something didn't work, it was more time gone. Another rent check, another health insurance payment, etc. My old boss, who was a great guy, tried to instill in me that money has a time value to it. And in the case of non-essential stock sitting on my floor for a year, it's made me painfully aware of a lesson I wish I could have learned when he tried to teach it to me the first time.

Moving forward, though, things aren't as dire as they have felt. A good friend and professor at a college I did a lockpicking course at has been helping me get things back together. I've just sent metal and cutting plans to a chemical etcher. When I get the test batch back I should be in business. Turnaround time should be about 2 weeks, hopefully less. The plan as it stands is to simply produce as many picks as I can at a time and start distributing those small batches. A lot of people, my Father included, have asked if I'm going to get a job. The short answer is "yes, probably" the long answer is that I've set a deadline. If I'm still struggling and not making forward financial progress by September, which marks the end of my lease and some other more personal milestones, I'm going to get a job, and continuing putting whatever spare money I have into producing picks.

Additionally, in the intervening time I've fixed the first batch of locks, which means that I have a number of excess locks and I plan to sell those at some upcoming events and put the proceeds directly into pick production.

There are still plenty of uncertainties. And I hate that. But, the picks will get made.

@Casey LOL! I don't think so. I had enough self awareness before to know that I'd be no good working for myself (I'd probably spend too much time going to conferences and watching TV) and I've certainly learned from this that it's harder than it looks.
If the CAD designs are done, I'm hoping that there's not that much standing in the way of getting parts made. Maybe too many companies are put off by the fact that they're lock picks, but I'd have thought someone must be prepared to make these.... if there's money left to pay for them.

In regards to the future of this project, I am curious whether there are even enough funds to tickle completion. The amount of funds that Schulyer alludes to being available to complete and ship the kits stands at $15,457. The true number is lower than that, though the amount is unknown as Schuyler has only hinted at some of the expenses. He mentions but does not quantify the cost of his auto insurance, and he notes the un-tracked personal expenses. In addition, at least one backer has had his funds returned, and I assume that # is sure to grow.
Schuyler mentions that he has 1/3 to 1/2 of the packaging materials purchased. Those will still need postage applied, and the remaining need to be acquired. If Schulyer goes with the smallest flat rate box option from the USPS, he is looking at $5906.25 in shipping, with no additional packaging purchases (this assumes 1125 units shipping: 1159 original backers less 1 refund less 33 digital media only orders). This total is very conservative, the high $$ backers kits will require a far higher packaging/shipping amount.
Without knowing the un-quantified expenses that Schuyler mentions, or the true cost of shipping, he is left with less than $10,000 to produce more than 17,000 picks, (under $0.60 per pick) while still paying for his living expenses.
Schuyler, you are going to need to get a job in order to self fund the completion of the project.

I don't necessarily blame Schuyler for quitting his job when he got the project funded. As someone else said he was optimistic and received way more money than he thought he would. I do blame him for not going out and getting another job when it became clear that the project was not moving forward. Not looking for a job until September, almost two full years since he quit, is far too long.

In the same way I wouldn't necessarily be mad if he used some of this money as a salary for personal expenses if he had been working full time at this but clearly he hasn't. The lack of promised updates shows this. The amount he seems to be putting towards other projects combined with the lack of updates shows that our money is being put towards things outside of the project.

Well, I'm not exactly a genius at math but I did a couple of quick calculations and given the number of backers for each level it looks like Schuyler will need to send out 4,459 locks (not including handcuffs and cutaways, to fulfill the obligation to his backers. I'm not sure why he initially only ordered 3,000 locks. I'm hoping he realizes that he has promised 17,395 picks and doesn't plan on an initial run of 10,000 picks. Please, if my math is wrong let me know.

Also, his 2 training events were only $1,500 more expensive than the previous level of backing which I would interpret as leaving a total of $3,000 for travel expenses to training of backers. In his travel he includes the cost of a Jetblue Bluepass. That is clearly not a cost effective purchase for traveling to 2 backers but rather fun money for traveling to conferences. Last year I attended my first security conference. I paid for it myself and would love to go back but don't know that I can afford it this year, it's called a budget.

It's clear to me that Schuyler does not have what it takes to run his own business.

Schuyler, I doubt you are reading all of these comments. I do not think you meant ill to all of your backers but you are clearly over your head and not ready to run your own business. I don't blame you for being young and irresponsible. You looked at your dream and wanted instant gratification rather than thinking things through. If you are smart you will try to get a job now and, when you've matured, possibly try to strike out on your own again.

That being said, I can't imagine Schuyler going to speak at any conferences until this project is done. I would think people going through CFPs would see him as tainted. Maybe that's enough of a punishment for him at this time.

Thanks for the transparency, but it is pretty much exactly what I figured with the lack of communication and emphasis on conferences and swag.

I respectfully request a refund - again - and would hope that those of us that choose to have this option be granted a refund.

I did not sign up to pay for your globetrotting, healthcare, rent, car, computer, or television - I choose to use my disposable income to provide these items for myself. I signed up to help fund a passionate individual who was interested in sharing a skill and unique set of tools with the world.

At this point, snake oil is all I feel I purchased and honestly this experience has dissuaded me from backing other projects that could have helped people better suited to not squander the success.

I'm not sure what high horse people are riding, but what business or even retail products do you purchase where you're only paying for cost and not money that also goes for salaries (which pay things like rent, food...), amenities, ancillary business expenses, and so on? Even stopping down at the local farmer's market for cheap (but quality) goods may end up bankrolling Joe's WoW addiction.

Maybe it would have just been better for Schuyler to lump all those personal spendings into "salary" and be done with it. Either way, get over it.

+1 to what Laz3r said. I still have faith in Schuyler and look forward to updates, product, and really just his own lessons on this whole process. And if I ever rub shoulders with you at a conference, I'll happily buy you a beer and talk shop, no matter how this turns out.

I know there are fears about whether or not we will receive the product we wanted, but if we do, then he lived up to his end of the bargain, TV or no. In the end, if you get what you 'ordered' then it doesn't matter where the money went. I'm not saying there weren't some major mistakes made, but welcome to starts-ups.

And seriously, maybe cut it out with the "You fucked up Schuyler" shit. I'm pretty sure he knows. And if we want this transparency to continue, or hope to see an increase of updates, maybe we shouldn't ream him every (albeit rare) time he shares some information on the project.

@IceCreamPirate: You seem to be forgetting you are dealing with a singular person here, not some vast corporation. Schuyler has an idea which a lot of us in the lockpicking community thought was cool, but honestly didn't think would ever attract enough interest to meet its (seemingly high) goal of $6K. He had not only reached this ambitious goal, but ultimately received 14.5x the amount he asked for. Imagine for a minute you had a crazy dream which you believed in, and suddenly there was an unbelievable outpouring of public support for it. Can you honestly not understand how someone driven by nothing but optimism and the best of intentions could become overly ambitious? And can you not imagine the pressure and crushing weight each setback would place on you? And remember, as the days turn into weeks, you still have to eat, and survive. Have some sympathy.

I understand a lot of people are disappointed -- but I don't see how expressing anything more than disappointment or support is helpful. If you are upset because you wanted picks, there are tons of places which sell picks, and honestly, many decent ones are cheaper than Schulyer's most optimistic price point. If you are upset because you wanted to see Schuyler succeed, then either be patient or move on with your life. Either way, endlessly complaining and pointing out the missteps Schuyler himself admits to helps no one.

I am a very understanding person and can understand setbacks, etc.
I didn't contribute to the project for the picks (I fare well with my bogota rake)... I contributed because Schuyler seemed so passionate about getting this started.

However, I have to admit that I am seriously disappointed with this last update regarding "finances".

I honestly believe that this project would have gone better if it had only received the $6k project goal as the focus of that money would have gone in to production vs. conferences and swag.

Believe me, I too love going to conferences and having health insurance... but I have priorities and can't always make the conferences I wish to go to. I definitely think that completing this project should have been a priority to traveling, buying a TV (spend more time on the project vs. watching The Big Bang Theory?), etc.

Hate to sound so negative, but I would probably be as blunt or more so if my kid ever tries to kickstart a project like this and basically spends all of the money.

I can actually imagine someone thinking "Well, I only asked for $6k and got $87k... more than enough to have some fun now and get the work done later".

I like to be positive, but I just don't see how this project could get completed now without: A: additional funds B: some sort of charity C: a SERIOUS compromise in quality

Pardon me while I rant. You seem to do enough of it, now it's our turn.

I am sincerely disappointed in your lack of common sense and basic understanding of start-up business practices. You had success in the palm of your hand and, as far as I understand from your updates, chose to freeload instead of following through with your promises (and your dreams). It's a little depressing, to be honest. It shouldn't take over a year to cut patterns into metal.

I, like many other backers, understand that Kickstarter projects are not all successful, but your willful disregard for the confidence of your supporters is just disgusting. I fail to see how this project would have stood any chance of success had you received only your original goal of $6,000. Perhaps, to that end, your apparent popularity and initial success went to your head. I can understand that, but only to an extent. This roll call of unrelated expenses is simply shocking.

if I were your best friend I would tell you to ship anything and everything you have now. Cut your losses, man. Send us your templates so at least we can handmake these picks long before you can send the real-deal our way. Let's be honest, at this point, with the money you have left, do you really think that the picks are going to be made? Are you going to be able to pay your rent and health insurance AND produce these picks on the scale that you need/want them to be? For your sake and your reputation as a locksport professional, I really do hope so. But what I really hope is that you have taken away more from all of this than just the regret of buying cases and locks before picks. Take a good, hard look at IceCreamPirate's spreadsheet and tell us what you have REALLY learned from all of this.

I want to be optimistic, for your sake. We've been patient, but it seems like many of us are ready to write this project off as a lost cause. Is that our fault, or is it yours?

Truly, no hard feelings. But it felt good to get that off of my chest. I wish the best for you in the future, but small business management probably isn't for you. As Ed Smiley offered above, please use the rest of your funds to have a beer on me too.

@ W. Aaron Waychoff "For anyone who believes that the funds pledged are not appropriately being spent on living expenses, I ask you what you think entrepreneurs do with the money they get from investors?"
I work for a company that is backed by VC funding and I can tell you that the entrepreneurs who started the company have used the money to build a company. They take a salary, they pay us a salary but they need justifications for any and all expenditures. They don't buy stuff because it looks cool and we might need it one day - they buy things that we need now to make progress towards our goals. If we do well in the first phase, we'll be able to get more funding to expand. That's the way this should have been run: the Kickstarter should have been Series A, the picks that were offered through the Open Locksport site should have waited to be like a Series B, to bring in more funds to expand the business based on the success of Series A.
It hasn't gone like that and I'm sure Schuyler regrets it. Maybe there will be enough money to get the picks out to the backers. Either way, there's 1,160 people who've learned a lesson here.

I don't find these numbers all that surprising, actually I was afraid it was worse. Though he's spent most of the money, he does have another pick making process in motion, and has a big inventory of locks and other supplies that are owed as backer rewards, so that money is not wasted. I'm not surprised he spent a lot of money on living expenses, when he quit his job that was inevitable. Maybe he should have kept his day job, but as others on here have said any startup company has to pay a salary to it's founders out of the initial investment, and this can add up.

Sorry to hear things didn't go as planned. Who knows... maybe you'll still be able to get the company running.
Please contact me before shipping the picks (I'm still hopeful :-) ), I've moved since the project went through and... let's just say that my former landlord isn't going to be friendly about forwarding any mail... so I'd like to update my address.

"I'm running this as a pre-sale to get the company started. The money you provide will net you the first run of these awesome tools and the profits will roll right back into the company allowing it to be self sustaining."

I feel for you man. We have such big plans... The scariest are when you owe other people.
Keep plugging away. If you have to get a job, this could look really good on a resume, as long as you don't actually mention that it was lockpicks you were working on. Maybe tell your future boss you were involved in domestic security...

Ok, I just don't even know where to start, but just going to make it short.

As with most people, extremely disappointed. For so long I have held out to not post on this site with negative comments and continued to stay positive. I also sent several private messages of support, well wishes, and even reached out to help as necessary. Hell, I even bought another set off the OpenLocksport site 'for the cause'. Now to see this, I am just in shock. My jaw hit the floor as I was reading it.

I will just end with this and with this I am the most disappointed. On April 11th, 2011 in Update #40, (http://www.kickstarter.com/projects/schuyler/lockpicks-by-open-locksport/posts/68224) you looked directly into the camera and said that you were not using these funds for personal items and that you have been traveling and making other money to take care of your living expenses. Yet, in this update you list TV's, Computers, rent, health care, groceries, and the list goes on.

W. Aaron Waychoff, the flaw in that reasoning is that ultimately these are not investment opportunities. These are sales of a product. Here's a trollish, advertising video that is nonetheless an accurate discussion on this: http://www.youtube.com/watch…

Oh, and it isn't like he has been working on this as a full time job. He has taken months off, where he just acted like the project didn't exist. Can you seriously justify him paying his rent with our money given that for a huge portion of time, my guess is many months combined, he wasn't even working on the project. You can't compare that to someone who is actually spending every day working on their company, and paying their living expenses alongside that, with schuyler who has been flying around doing workshops, with the project in the background.

"To those complaining about non-project costs I would look to point out:
Kickstarter's purpose is to do just that, kickstart enterprises."

What are you talking about? Kickstarter is mostly made up of projects working towards producing one single thing. An iPhone case. A movie. An album. It is not meant to start companies (though it does act as a springboard in many cases)... the main purpose is to provide funding for products that people want to own or support. It is not just "here, give some money towards starting this persons business," it is "give money to see the product concept brought to life," whether or not a company will be born of that is tangential to what the purpose of kickstarter it. It is not seed funding.

"Paying for living expenses with investment funds is not only legal, it's generally expected."

Nothing in either of the links you posted supported what you said. Obviously some living expenses will be spent by the investors, but please, please show me where it says it is normal for the majority of money to be spent on living expenses, including flying around, taking vacations, buying tv's, computers, etc.

You cannot compare a tech companies funding to the funding someone receives to produce a physical product. Most of ycombinators funding goes to tech startups, and they don't have to pay for physical objects and paying other companies to produce something for them. They may have to pay for a server, but their work mainly consists of sitting at a computer and writing code... something that doesn't cost any money. It is vastly different for a company that has to pay other companies in order for their product to come to fruition. Something is severely wrong when 2/3rds of the funding goes towards living expenses, vacations (those workshops were vacations), other kickstarter projects (Schuyler has funded 36, most, if not all, after this project was funded), donations to make shops, etc.

Schuyler, to be blunt, but honest: my goal wasn't to fund a Locksport mascot. I wasn't funding this venture because I needed a bundle of picks... it was a desire on my part to invest in something that seemed to have the promise of generating some good publicity for Locksport, raising some interest in the hobby, and getting good tools into the hands of folks who were starting out.

If you had laid out a plan to pay yourself a fixed monthly salary out of the project funds, proportionate to the commitment it required, I think I could have accepted that. By funding this project, though, I was funding a specific business venture whose vision I believed in, and wanted to succeed... I was not throwing some cash into your personal savings account, in the hopes that you might make some lockpicks in your spare time.

This project had a specific goal. Conference talks, video series, lockpicking workshops... those are different goals. I'm not going to argue that they're /bad/ goals -- but they're /different/ goals, and they're not the goals that we invested this money in support of.

The investment proceeds for this venture should not have been used for other ventures. It should not have been used to donate hardware to hackerspaces, run presentations for other groups, do research on lock history, make cut-away locks, or attend conferences.

I'm a little angry... but I'm mostly just sad to see the wasted opportunity.

To those complaining about non-project costs I would look to point out:

Kickstarter's purpose is to do just that, kickstart enterprises. It is not a place that exists primarily to sell consumer goods. You're paying not so much for the goods purchased, but to help get some sort of venture going, for which you are offered bonuses from the new venture that should probably be rather minor. He promised too much, and thought he had his shit far more together than he did, but keep in mind that he was only actually seeking out about 7% of the investment he got, which would've been much more managable to step into. Anyway, you were basically paying for the traveling, conference visits, stickers, lock sales, etc. that are part of the business. You weren't paying specifically for your picks, and I don't know what about this site could've given you this idea.

All businesses pay for food, rent, etc. In most cases, they simply call these payments "wages".

Paying for living expenses with investment funds is not only legal, it's generally expected. For instance, see YCombinator's page here: http://ycombinator.com/about.html Paul Graham agrees here: http://paulgraham.com/startupfunding.html and other examples are readily available. In fact, for many startup businesses, living expenses of the founders can be the largest expenses to cover during the first years. This is normal and part of the business community.
I suspect it's hard for people to understand this when they see "unnecessary" expenses that they feel they have paid for when they have not yet received their goods, but this is not the argument to be making.

@Jason Aller
Yes. Funding for a project should be spent on the project, not on personal and living expenses (unless that is started clearly upfront). I think any money that goes from us directly to him would also fall into the category of charity, which is clearly prohibited by Kickstarter.

If he wants to pay for labor (his or anyone elses) that's a valid business expense - but it comes along with a number of issues that would also have needed to be addressed (taxes chief among them). That said, when he was raising money, he never said he would be paying himself, or paying others, and given that he was originally only looking for $6,000 I don't think anyone would have expected that to be part of the deal.

"For anyone who believes that the funds pledged are not appropriately being spent on living expenses, I ask you what you think entrepreneurs do with the money they get from investors?"

He has used 2/3rds of the money on things that have nothing to do with the project. If you think that is how a normal entrepreneur spends funds from an angel investor, you are severely mistaken. Most spend it on actually getting the business started. Some personal expenses, but nowhere near the percentage Schuyler has spent, and not on a vacation. And Schuyler hasn't been working on the project, he took a lot of time off, and travelled a lot. It wasn't like he has been dillogently working full time. He even saw fit for a vacation. Vacation from what?

Thank you for this, but I can't help but think we would've greatly preferred it if you could've managed to give us the bits of information available at the time as several posts rather than waiting a month and a half between updates.

Thank you for this update. I feel SO much more comfortable with this transparency. I, for one, understand what it means to back a novice in a business venture and feel that we are in this together, doing something new. If I had just wanted a set of lockpicks, I would have simply ordered a set. I chose to back your project because I want the picks YOU design and I am anxious to try them out.
For anyone who believes that the funds pledged are not appropriately being spent on living expenses, I ask you what you think entrepreneurs do with the money they get from investors? A central part of this project from the beginning was to enable Schuyler the opportunity to make this happen. Part of that is making sure he has the time to do so.
Yes, there could have been more communication. Yes it has taken a long time. Yes, I am *very* anxious to have these picks in hand. But backing a project on Kickstarter is NOT the same thing as placing an order on Amazon. You take risk. Sometimes you are rewarded. Sometimes there's some frustration. Keep it up.

Schuyler: When full production begins, if you find more funds are needed to get the picks, PLEASE let me know - I would be happy to throw in a few more $$ for the home stretch. Also, PJ Neal has a point - many of us have changed addresses in the last 18 months - you will need to get updated info for sure!

@PJ Neal
Would it have been any different if he had instead listed an hourly rate for the labor he has put in on the project multiplied by the number of hours instead of listing the expenses he paid for?

You, sir, are a fraudulent businessman. There is a code of ethics in the sport that you compete in, but not in the way you handle yourself in the business of the sport. It took a complaint to and response from the Office of the Attorney General of MA to actually get an update from you, and this is what you come back with? A detail of how we supporters have underwritten your living expenses? Did the TV work to helping with the process? If you purchased a computer, perhaps you could have used it to keep us updated? I find it hard to trust that anything fruitful will come from this project except a learning experience for you, and I didn't sign up for that.

Also: You need to find a way to get updated contact details from all your backers. I'm sure a ton have moved, given the unbelievably long time it's taken for this to get done. Last thing you want is to not be able to deliver what you promised... should you ever try to deliver what you promised.

"It shouldn't have been spent on things peripheral to the task of providing the rewards to the backers until the last reward had shipped out."

Exactly. I have seen a lot of businesses start up, and I have never seen someone take the limited money they were given and spend it like it was their own personal income, only putting 1/3rd towards actually getting the business going.

Does anyone else buy that this has been a full time job for Schuyler, justifying him quitting his job? It seems like it has been a part time job at best, and mainly a vacation doing workshops. I can't figure out why he thinks he doesn't need to get job yesterday. He is going to spend at least another $12,000 if he waits until september to get a job. That is almost 15% of the total kickstarter funds.

Wow. While I certainly appreciate an honest update on this project, I can't believe what you have spent the money on. I'm sure this comment thread will fill up in the next hours with a huge backlash and I hope you're braced for that.
The people who backed this project, like all other projects on Kickstarter, were buying a physical object. The rules of Kickstarter specifically prohibit charitable ventures. We would not have been allowed to give you money just so that you could travel to conferences and give up your real job even if we had wanted to. Using the Kickstarter funds to pay your medical insurance and repair your car seems to amount to fraud to me...
If you had wanted to quit your old job to start a company, you probably could have used the funds raised in this Kickstarter project to secure a Small Business Loan or something like that, but the money from the project should have been sandboxed and used only for project related expenses. You must have done some kind of cost estimation when setting the rewards / pledge levels, so depending on how much profit you were building in, you should have known from the start how much money was needed to actually produce the goods. Nothing in this update makes it clear whether there is enough money to fulfill all the orders from whatever you haven't spent yet...
And regardless, profit is what you have LEFT, AFTER you've fulfilled all your commitments. It shouldn't have been spent on things peripheral to the task of providing the rewards to the backers until the last reward had shipped out.

I think Kickstarter really needs to take a good look at its practices. People who start projects should have at least some kind of business plan and some kind of a clue on how to run the project. I'm not self employed but I can see what a responsibility it would be to have that much of other people's money and have to produce something I'd promised. Maybe Kickstarter needs to set up escrow accounts to hold the money of successful projects and only let the project creator withdraw from the account for legitimate expenses. A massive overhead for Kickstarter, I know and it's supposed to be based on mutual trust, but many more projects that go the way this one has and I'd think they'd have to consider it....

"Taking the $10,980 as the cost on 3000 locks which he can group into sets of 3 and sell for $20 each will total $20,000 and subtract the cost from that and I see $9020 profit from the mistake that can be added toward making picks."

Two things. I don't see where you pulled the $20 figure from. Also, I don't have a lot of faith in Schuylers ability to follow through on his word. When those locks have been sold, and the money is in the bank, then I would update the spreadsheet to reflect that.

The spreadsheet is an accurate picture of expenses as they are right now. I'm not going to edit it to reflect something that may or may not happen in the future.

@IceCreamPirate
In your Google spreadsheet you list $22,000 for locks, but that has three components. $3000 worth of special locks, and two sets of 3000 locks totaling $19,000 that he paid a per unit price that differed by approximately a dollar for. So of that $19,000 if we go with a per lock cost of $3.66 for the first set that wasn't up to snuff, and $2.66 for the second we get $7980 spend on locks that will be shipped out (along with the $3000 special ones) and $10,980 spent on locks he is going to sell. Taking the $10,980 as the cost on 3000 locks which he can group into sets of 3 and sell for $20 each will total $20,000 and subtract the cost from that and I see $9020 profit from the mistake that can be added toward making picks.